Living in PG County, MD: FAQ: Pre-qualification vs. Pre-approval

FAQ: Pre-qualification vs. Pre-approval

FAQ:  Pre-qualification vs. Pre-approval

Many times these 2 terms are used inter-changeably.  However, both terms mean very different things.

Pre-qualification

This is an estimate of how much home you can afford based on information you provide to the lender.  This is usually a quick process and the lender does not verify the information you provide.

Pre-approval

During the pre-approval process you complete a formal loan application and provide the lender with the documentation necessary to verify your financial status.  At this time you will provide proof of income, bank statements, etc and a credit check will be completed.

At this point the lender will be able to give you a specific mortgage amount for which you qualify and be able to give a good estimate of potential interest rates.

 

A pre-approval is a more attractive status to a seller because the seller knows that your financial information has been verified by the lender.

 

Neither pre-qualification nor pre-approval is a commitment by the lender to provide a mortgage.  Final mortgage commitment is dependent on appraisal of the home and a re-check of your credit and financial information.




If you or someone you know would like information about buying, selling, or renting a home in Prince George's, Montgomery,  Charles, Calvert, Anne Arundel, Howard, and/or Baltimore Counties please contact Dr. Stacey-Ann Baugh of Century 21 New Millennium.

 

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Dr. Stacey-Ann Baugh

Century 21 New Millennium

www.LiveinPGCounty.com

staceyannbaugh@gmail.com

240-481-3565 (C)

202-546-0055 (O)

 

FINALLY!  A DOCTOR WHO MAKES HOUSE-CALLS!

 

Information deemed reliable but not guaranteed! 

 

 

 

Comment balloon 6 commentsDr. Stacey-Ann Baugh • June 09 2012 05:22PM

Comments

Great simple blog breaking down the differences.  Thanks for the blog

Posted by Jessica Holtzman, Real Estate Agent in Southern New Jersey, CDPE (Keller Williams Realty, Inc.) over 6 years ago

Major difference ..pre-qual it the way to go...Thanks for sharing with us in ActiveRain Land.

Posted by Ronald DiLalla, No. Orange Cty Real Estate (Century 21 Discovery DRE 01813824) over 6 years ago

Jessica - thanks

Ronald - I think you mean pre-approval is the way to go

Posted by Dr. Stacey-Ann Baugh, A doctor who makes house calls. (Century 21 New Millennium) over 6 years ago

Luckily most of my buyers are paying with cash, so we can bypass these.  It has been my experience when working with buyers who do need a mortgage that they have a hard time getting a formal Pre Approval letter.  Many lenders want to charge about $400 for this, and even then they want the property address before they issue the Pre Approval.   This can be frustrating when trying to submit an offer in a hurry along with a Pre Approval. Any one else having this issue?

Posted by Kevin O'Rourke - Keller Williams Miami Beach Realtor, CDPE Miami Short Sale Agent 305-520-9436 (Keller Williams Miami Beach Realty) over 6 years ago

Kevin - I haven't had anyone complain about being charged for a pre-approval.  

Posted by Dr. Stacey-Ann Baugh, A doctor who makes house calls. (Century 21 New Millennium) over 6 years ago

This is so important for buyers to know and you have explained in a way that is simple to understand.

Posted by Debbie Cook, Silver Spring and Takoma Park Maryland Real Estate (Long & Foster Real Estate, Inc) over 6 years ago

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